A senior mortgage holder is owed a mortgage balance of $140,000 and brings a foreclosure suit which includes all junior claimants in the suit.If the senior mortgage holder purchases the property for $140,000 at the foreclosure sale,what happens to the claim of the junior claimants?

Question

Quizplus · Accepted Answer

When a senior mortgage holder purchases the property for the amount owed on the mortgage at the foreclosure sale, the liens of the junior claimants are extinguished. However, the debt owed to the junior claimants is not automatically extinguished and they can still pursue the borrower for any remaining balance. So, option B is the correct choice.

A Senior Mortgage Holder Is Owed a Mortgage Balance of $140,000